Yesterday, House Majority Whip Kevin McCarthy (R-CA) released a Republican “jobs agenda” platform. In reality, the agenda is a laundry list of resounding jobs killers.
The primary problem is that the House Republican agenda pulls the rug out from under aggregate demand. Doing so is the number one impediment to job creation, business investment, and reducing the deficit. There is widespread agreement on this from across the spectrum, including conservative economists such as Martin Feldstein and Bruce Bartlett.
But that’s not all. The House Republican “jobs agenda” also:
- Undermines the financial position of middle-class families, who are the engine of economic growth
- Cuts public investments that can create jobs now and are critical to the competitiveness of U.S. private businesses
- Blocks development of a new advanced technology renewable energy manufacturing industry in the United States
- Recreates the conditions for more jobs- and growth-killing financial crises
The most complete articulation of the House Republican policy approach to job creation and economic growth is their budget plan, which passed in the House of Representatives in April on a party-line vote:
- The House Republican budget ends Medicare as we know it, kicking low-income and middle-class retirees into the inefficient private insurance market that is the biggest cause of the U.S. long-run deficit and debt challenge.
- It cuts $1.4 trillion in public investments in education and lifelong learning, efficiency-enhancing infrastructure and energy modernization, and science research and technological R&D that create jobs today, “crowd-in” private investment, and provide a foundation for long-run sustained economic growth.
- The plan offers tax cuts to U.S. billionaires paid for by raising taxes on the middle class and shredding social protections for those hit hardest by the economic downturn, which are the most efficient policies to boost jobs and economic growth in the short term.
- All told, the House Republican budget would kill an estimated 1 million jobs.
The House Republican “jobs agenda” Rep. McCarthy proposed yesterday presents a litany of bills that in fact provide explicit subsidies for big corporate oil, coal, and gas producers. By now you’ve surely heard about the tax subsidies these companies enjoy at the expense of fiscal policy. But privileges for Big Oil and coal companies and the stranglehold they have on national energy policy also are blocking the development of renewable energy—a fledgling advanced technology manufacturing industry that will create jobs right here in the United States:
- The House Republican budget and other proposals to privilege oil and coal over all would strangle innovation in key areas of cutting-edge renewable energy technology and manufacturing.
- The House Republican “jobs agenda” would keep the United States mired in early 20th century technology while the rest of the world, not least China, is fighting to seize this renewable energy technology future.
But perhaps no policy is a bigger jobs-and-growth killer than the unregulated financial predation and speculation that created the bubble, financial crisis, and economic weakness the U.S. economy now faces. The House Republican “jobs agenda,” however, actually will recreate the financial policy conditions that got us into this mess. On their agenda are plans to:
- Gut consumer financial protections put into law by the July 2010 Wall Street Reform and Consumer Protection Act, passed with only one Republican House member dissenting
- Slash funding from the Commodity Futures Trading Commission—the regulatory body charged to make sure that derivatives and futures speculation does not metastasize as a “financial weapon of mass destruction,” derailing the U.S. economy
On all fronts, this House Republican agenda offered by Rep. McCarthy takes us in the opposite direction from what the U.S. economy needs to get back on track creating middle-class jobs, investment, and technological innovation critical to economic growth.
Adam Hersh is an Economist at American Progress.
- Spurring Job Creation in the Private Sector by Michael Ettlinger, Donna Cooper, Sarah Wartell, and Bracken Hendricks (CAP Action)